Sinha misled House on US-64: CongNew Delhi, November 27
Finance Minister Yashwant Sinha today drew flak over the US-64 scheme with Congress member Suresh Pachauri charging him with misleading Parliament on the issue of repurchase of units by the mutual fund.

Continue subsidised power to farm sectorDespite opening up power generation to private investment with lucrative financial incentives a decade ago, private investment has so far been insignificant at prospective investors and financial institutions are reluctant to invest in the power sector for want of adequate and bankable mechanism or appropriate escrow cover to ensure payments because of poor financial position of the state electricity boards to whom private power generators are obliged to supply power with no third party sales permissible under the existing policy framework.

Economy to recover by next year: FMNew Delhi, November 27
Finance Minister Yashwant Sinha today expressed the hope that the country’s economy would recover from next year and said better agricultural production would have a major contribution in boosting growth.
Responding to supplementaries during the Question Hour in the Rajya
Sabha, Mr Sinha said, “by the middle of next year, things will start
improving”.

Jewellery exporters eye Latin AmericaChandigarh, November 27
India is eyeing the Latin American market for jewellery exports following slowdown after the US disaster. The export orders to America, which account for more than 35 per cent of India’s jewellery exports, have not materialised for the past three months.

PowerGrid gets WB loan
New Delhi, November 27
Powergrid Corporation of India Ltd has received $ 450 million loan assistance from the World Bank for various projects, including for diversifying into telecom business.

IELTS training centre for cityChandigarh, November 27
Chandigarh will soon go on the global map with the most sophisticated facilities for the IELTS training. Mr Naresh Gulati, Managing Director of Oceanic School of IELTS said here today that their company under licence from Centre of English Language Learning, RMIT University, Australia will be training the IELTS aspirants to achieve their desired score. Mr Gulati confirmed that CELL is the largest IELTS testing centre of Victoria, Australia and is located in Victoria’s capital Melbourne.

Govt working out formula on cooking gas price: NaikNew Delhi, November 27
The government today said that it was working out a formula to announce a package in the next Budget to spare the middle class and poors from a substantial hike in prices of cooking gas after dismantling of Administrative Price Mechanism
in April, 2002.

Dabur net rises
New Delhi, November 27
Dabur India Limited recorded a net profit of Rs 33.3 crore in the first half
of the current fiscal, achieving a growth of 13.3 per cent over Rs 29.4 crore in the corresponding period last year.

Firms should go for demat by Jan 2
Mumbai
The shares of the companies which do not make arrangement for dematerialisation of their shares by January 2, 2002 would be traded on Trade-to-Trade basis.

ROUND-UP

Govt ‘harassing’
Tehelka investors
New Delhi, November 27
Tehelka.com today accused the Central Government of carrying out “draconian harassment” against the portal’s investors through several agencies for its expose on corruption in defence deals.

New Delhi, November 27
Finance Minister Yashwant Sinha today drew flak over the US-64 scheme with Congress member Suresh Pachauri charging him with misleading Parliament on the issue of repurchase of units by the mutual fund.

Saying that Mr Sinha had committed a breach of privilege, Mr Pachauri said during Zero Hour in the Rajya Sabha that the Finance Minister misled the House when he claimed that he had no knowledge about the decision on the repurchase of units under the US-64 scheme.

Mr Pachauri said he had already served a notice under Rule 188 to the Chairperson requesting him to bring the matter under the purview of breach of privilege of the House and refer the matter to the Privileges Committee.

Mr Pachauri made the charge at a time when the Joint Parliamentary Committee is looking in to the UTI imbroglio. The JPC has gone into the matter whether the Finance Minister knew about the decision or not.

The Congress member said the former UTI Chairman had also confirmed that the Finance Minister was aware of the decision in advance. The Finance Minister had deliberately kept the House in the dark by making a misleading statement, he said and added that this constituted a breach of privilege.

The Finance Minister denied the charge of breach of privilege. Newspapers had reported the extracts of a deposition evidence made by the Finance Secretary before the Joint Parliamentary Committee on the UTI scam, Mr Sinha said. Tendering evidence was a confidential matter which could not be published until the committee had submitted its report. This itself constituted a breach of privilege by the newspaper and a breach of privilege notice had been filed against the newspaper, he added.

Mr Sinha maintained that there was no contradiction in the statement made by the Finance Secretary and he himself on the issue and there was absolutely no merit in the charge that he had misled the House.

Earlier in the Question Hour, the Finance Minister expressed the hope that the country’s economy would recover from next year and said better agricultural production would have a major contribution in boosting growth.

“By the middle of next year, things will start improving,” Mr Sinha said responding to supplementaries. Stating that a growth of 4.5 per cent had been projected by the IMF, he said India would be among the fastest economies in the world, only second after China where growth has been pegged at 7.5 per cent.

As part of the broad strategy for promoting economic growth, various tax reform measures were taken to promote greater investment and consumption demand.

He told his collegues that budget expenditure had to be spent as early as possible and then only he would be able to provide supplementary allocation to them. The total allocation on infrastructure stood at Rs 64,000 crore in the Budget this year, 40 per cent of which had already been spent. The government had some ambitious projects like for the road sector, rural development and Sampoorna Gramin Rozgar Yojana, he added.

He said these projects would provide the necessary demand to boost the economy.

Despite opening up power generation to private investment with lucrative financial incentives a decade ago, private investment has so far been insignificant at prospective investors and financial institutions are reluctant to invest in the power sector for want of adequate and bankable mechanism or appropriate escrow cover to ensure payments because of poor financial position of the state electricity boards (SEBs) to whom private power generators are obliged to supply power with no third party sales permissible under the existing policy framework.

The boards are incurring huge financial losses as they are obliged to supply power to agricultural consumers and economically weaker sections of domestic consumers, (which consume around one-third of the total power supply) at subsidised rates as a part of the socio-economic policies of the state governments. The financial position of the boards is further eroded by rampant theft/pilferage of power supply, high transmission and distribution losses, and poor collection of even the billed amounts. Good financial performance of the SEBs and successor power entities is essential not only for a healthy development of the power sector but also to attract private investment to this crucial sector.

Keeping this in view, the principle features of the power reforms should have been logically focussed on measures to improve financial viability of the power sector through appropriate rationalisation of tariff particularly for the agricultural consumers to better reflect the supply costs, reduction in theft/pilferage of power, provision of metering at all the consumer premises, improving efficiency of billing and bill collections and enforcing performance accountability in all the board’s operations. In this context, justification for continued supply of power to the agricultural sector, at subsidised rates, needs critical consideration.

Tariff/subsidy for agricultural supply

Coming to the much criticised policy of supply of power to the agricultural sector at highly subsidised rates or even free of cost in same states, a major cause of huge financial losses being incurred by the SEBs and the demand of the power reformers to eliminate the subsidies and cross-subsidies in the power sector, there is no doubt that the tariff for supply of power to all the consumers should, by and large, reflect the supply costs and any intended subsidisation of tariff for any targeted category of consumers should be supported by the government through state budgetary provisions to ensure financial viability of the power entities.

Having said that, it would, at the same time, be desirable to consider the genesis of the scheme for subsidy for the farming sector in its proper perspective. When the country was facing severe food shortage in the sixties and was dependent on import of food grains (under PL 480 programme), an extensive programme of energisation of pump sets was taken up by the government throughout the country with a view to giving a boost to food production in the shortest possible time. Power supply to the farming sector at subsidised rates was considered as an economic compulsion and a necessity to promote food production.

This strategy helped the country to usher in the green revolution and achieve self-reliance in food production over a short period of time. Supply of power at subsidised rates to the agriculture sector has continued over the years to sustain self sufficiency on the food front. Presently, due to power shortages during the past several years, power supply to the agricultural sector is restricted to hardly 6-8 hours a day in most of the states and even that is generally supplied on a roster basis during off peak and night hours, as compared to 24 hours power supply available to the urban consumers.

Even this restricted supply is not available regularly in the rural areas because of frequent power breakdowns of the poorly maintained long rural feeders, as compared to the much better quality of power supply in the urban areas.

Can we imagine the condition and plight of the farmers when they have to stand in the fields during severe winter months, shivering, to water the fields by running the electric/driven water pumps at odd hours. How can we then grudge and equate his tariff to that of tariff for the urban consumers. Most of the farmers are only marginal farmers and are hardly able to sustain their operations even at subsidised power costs. Farming sectors are subsidised, in one form or the other, in almost all the countries all over the world. Viewed dispassionately, the supply of power to the farming sector which in any case is available only for a few hours in a day, at subsidised rates, would be justified on economic and equitable considerations for this sector’s national service in making the country self-reliant in food production even under adverse conditions of power availability.

As per recent Planning Commission studies, the total overall gross subsidy on power supply to the agricultural consumers has progressively increased from a level of Rs 9500 crore in 1992-93 to around Rs 25,000 crore a year. Although subsidisation of power tariff of the agricultural consumers is justified, even under the present liberalised environments, but keeping in view the widening gap between the cost of power and actual realisation of costs from this sector resulting in huge financial losses to the boards, perhaps some retionalisation and gradual increase in the power tariff to cover around 50 per cent of the cost of power over the next 2-3 years and continuation of the system of cross-subsidisation by the comparatively affluent industrial/commercial consumers, as hithertofore, could be considered by the state governments and the regulatory commissions in the overall national interests.

The marginal revenue gap, if any, could be paid by the state governments as ‘subsidy’ to the boards/power entities/licensees through budgetary support. The total notional subsidy and cross-subsidy to the farming sector should be shown in the electricity bills of the agricultural consumers, in addition to the billed amount (consumption charges), to emphasise the importance and extent of subsidy being extended to the agricultural consumers by the government.

This could also help in gradual reduction of the element of subsidy over a period of time when economic considerations so merit. In case the state governments do not want to enhance the tariff for agricultural supply even to cover 50 per cent of the cost of power because of their political compulsions, the government could consider levy of a cess either on power generation or on sale of farm produce which should generate additional revenue of around Rs 15,000 crore annually to compensate the boards/power entities for the financial losses sustained as a result of continued supply of power at subsidised rates to agricultural consumers.

Mr S.K. Aggarwal is former Member (Planning), Central Electricity Authority, Government of India.

New Delhi, November 27
Finance Minister Yashwant Sinha today expressed the hope that the country’s economy would recover from next year and said better agricultural production would have a major contribution in boosting growth.

Responding to supplementaries during the Question Hour in the Rajya Sabha, Mr Sinha said, “by the middle of next year, things will start improving”.

While pointing out that a growth of 4.5 per cent had been projected by the IMF, he asserted that India would be among the fastest economies in the world. The growth rate would only be second to China where growth has been pegged at 7.5 per cent, he said.

The Finance Minister said agriculture growth rate was a major contributor to the country’s economy and hoped this year the contribution would be better than in the previous two years.

While it was 0.7 per cent in 1999-2000, it was still lower at 0.2 per cent in 2000-01, he said and added the government was aware of the impending slowdown in the economy while presenting the General Budget this year and took a number of steps in advance.

He said as part of the broad strategy for promoting economic growth, various tax reform measures were taken to promote greater investment and consumption demand.

Emphasis was laid on faster implementation of Central Plan Outlays and completion of projects for key infrastructure sectors and on promotion of capital investment in the private sector as well, he said adding RBI further reduced bank rate from 7 per cent to 6.5 per cent, rationalised Cash Reserve Ratio for banks and reduced the maximum interest rate chargeable on export credit.

Chandigarh, November 27
India is eyeing the Latin American market for jewellery exports following slowdown after the US disaster. The export orders to America, which account for more than 35 per cent of India’s jewellery exports, have not materialised for the past three months.

The decline in the gems and jewellery exports hit the country’s overall exports as the jewellery sector contributes almost 19 per cent to the country’s total exports.

Though the situation has started improving, but the exports are unlikely to cross last year figures, said Mr George Punnose, Regional Officer (North of Delhi), the Gem and Jewellery Export Promotion Council . He is here in the city to address a seminar on jewellery exports to be held tomorrow by the council. Mr J.S. Tiwana from the Ministry of Commerce will also speak.

India exported gems and jewellery worth $7.7 billion last year.

“The orders placed by American companies from September onwards are still pending, causing an overall decline in the exports”. The pending orders constitute more than one-fourth of the total jewellery exports during the year.

Stating that the government is also encouraging exporters, he said the Ministry of Commerce has implemented the Market Development Assistance Scheme which offers financial aid to the exporters to promote their product. The exporters can avail financial assistance for sales cum study tours, participation in trade fairs and exhibitions through printed materials.
TNS

New Delhi, November 27
Powergrid Corporation of India Ltd (PGCIL) has received $ 450 million loan assistance from the World Bank for various projects, including for diversifying into telecom business.

The loan would enable PGCIL to move a step towards establishment of a National Grid in the country, a company release said here today.

Some projects that would be implemented through this loan are East-North Inter-connector-I (Sarsaram HVDC), East-South Inter-connector-II (Talcher-II Transmission System) and Unified Load Disptach Schemes in Eastern and Western Regions, the release said.
PTI

Chandigarh, November 27
Chandigarh will soon go on the global map with the most sophisticated facilities for the IELTS training. Mr Naresh Gulati, Managing Director of Oceanic School of IELTS said here today that their company under licence from Centre of English Language Learning (CELL), RMIT University, Australia will be training the IELTS aspirants to achieve their desired score. Mr Gulati confirmed that CELL is the largest IELTS testing centre of Victoria, Australia and is located in Victoria’s capital Melbourne.

The centre will be inaugurated by Mr Lee Wapling, Director, RMIT Training, Melbourne, Australia on December 3, in Sector 9-C, here.

International English Language Training System popularly known as IELTS is a test used by countries like Australia, United Kingdom, New Zealand, etc to judge the applicant’s knowledge of English. On the contrary , IELTS test the applicant’s proficiency in all the four areas — speaking , listening, reading and writing.

The centre has been brought to India by India’s leading education and immigration consultancy specialising in Australia and New Zealand. The company is also currently hosting the only helpdesks in India for the leading Australian Institutions RMIT University, Holmesglen Institute of TAFE and Regency Institute of
TAFE.

Govt working out formula on cooking gas price: NaikTribune News Service

New Delhi, November 27
The government today said that it was working out a formula to announce a package in the next Budget to spare the middle class and poors from a substantial hike in prices of cooking gas after dismantling of Administrative Price Mechanism (APM) in April, 2002.

Petroleum and Natural Gas Minister Ram Naik told the Rajya Sabha, “we are working out a formula in consultations with the Finance Ministry to ensure that weaker sections and the middle class are not made to pay so high a price immediately after dismmantling of the APM in April, 2002.”

Replying to supplementaries, Mr Naik said even if the government wanted to keep the subsidy at 15 per cent despite the doing away of APM, the subsidy would be to the tune of Rs 94.50 per cylinder as against the current level of Rs. 150 per cylinder.

Stating the government would not be able to increase the subsidy any futher than Rs 94.50, he said the next Budget will contain measures to ensure that the middle class and weaker sections do not bear the brunt of the hike in prices.

He said despite the government saving Rs 260 crore annually on account of the LPG pipeline from Jamnagar to Loni, it had to meet the commitment of bridging the oil pool account deficit.

New Delhi, November 27
Dabur India Limited recorded a net profit of Rs 33.3 crore in the first half (HI) of the current fiscal, achieving a growth of 13.3 per cent over Rs 29.4 crore in the corresponding period last year.

Growth in net profit excluding provision for deferred tax was 19.1 per cent, the company said today.
UNI

Mumbai
The shares of the companies which do not make arrangement for dematerialisation of their shares by January 2, 2002 would be traded on Trade-to-Trade basis.

The Demat Group of the SEBI has decided that the companies which have so far not made arrangements for dematerialisation of their securities should be brought under compulsory demat mode by January 2, 2002.

The BSE has advised all the companies to go for demat mode latest by January 2, 2002, failing which trading and the settlement in their shares would be shifted by the exchange on Trade-to-Trade basis.
UNI

ROUND-UP

Govt ‘harassing’ Tehelka investors

New Delhi, November 27
Tehelka.com today accused the Central Government of carrying out “draconian harassment” against the portal’s investors through several agencies for its expose on corruption in defence deals.

“Our investors are suffering at the hands of a slew of government agencies ... This is coupled with the maliciously wild conspiracy theories the government has been levelling against Tehelka in the Venkataswami Commission in an effort at besmirching its investigation,” a website release said.

Accusing several independent government agencies of colluding in this campaign, Tehelka alleged despite having 14.5 per cent of equity in the portal and no editorial interest whatsoever, first Global have had its business shut down, its properties attached and travel banned in the ‘’most extra constitutional manner possible without any shred of evidence”.
UNI

India to be global telecom player?

Bangalore
India is poised to be a major player in the global telecom scenario owing to its dyanamic market, a study has said.

The study, conducted by Gartner Dataquest’s Worldwide
Telecommunication and Networking Group, said though India base, at present, was small, it had a dynamic market.

All telecom manufacturers were looking at Asia-Pacific, and China in particular, for continued growth.
UNI

No FIs’ nominee on Dunlop Board

New
Delhi
The government said today despite financial institutions holding 33.21 per cent stake in ailing Manu Chhabria company, Dunlop India, they have no nominee Director on the company’s Board.

In a written reply to the Rajya Sabha, Minister of State for Finance Balsaheb Vikhe Patil said “as per the shareholding pattern reported by the company in June 2001, the stake of the institutions in the equity capital of the company was 33.21 per cent. As on date, the institutions have no nominee Director on the Board of Dunlop India.
PTI

Rado WatchMumbai, November 27
Rado Watch Company has introduced its latest product christened as eSenza here today. eSenza, which in Italian means “It is without” has left out the crown of the watch in the design. The watch is priced at Rs 34,200.
UNI

Silverline
Mumbai, November 27
Silverline Technologies and Corechange Inc, have announced an agreement that will provide companies with additional revenue opportunities and the ability to accelerate the delivery and implementation of enterprise portals. This product development and reseller agreement will enable Corechange to outsource selected product enhancement and development work on Coreport to Silverline’s India-based offshore software development centres.
UNI

Ashok Leyland
New Delhi, November 27
Ashok Leyland has signed an agreement with Bangladesh Government to supply truck chassis. According to the agreement, 500 truck chassis, valued at $ 6 million, would be supplied in completely knocked down (CKD) form for assembly by Pragoti Industries Ltd, a Bangladesh Government Undertaking, an Ashok Leyland release said today.
PTI

Lijjat Papad
Chandigarh, November 27
The excise duty of Rs 127 crore to Shri Mahila Griha Udyog Lijjat Papad slapped by Central Excise Commissioner, Mumbai III (now Mumbai VI) has been waived by Mr J H Joglekar (Technical) and Mr G N Srinivasan (Judicial), members of CEGAT for a period of five years prior to November 11, 1997, said a press release. TNS